Remitly’s Q1 2025 Earnings: A Test of Momentum in a Volatile Landscape

Remitly Global (NASDAQ: RELY) is poised to deliver its Q1 2025 earnings report on May 7, 2025, a critical juncture for the cross-border payments firm as it seeks to validate its growth narrative amid macroeconomic uncertainty. Analysts project a dramatic 105% year-over-year surge in earnings per share (EPS) to $0.17, while revenue is expected to hit $347.5 million—a 29% increase—marking another quarter of robust expansion. Yet beneath these optimistic forecasts lies a complex reality: Remitly remains unprofitable, with a trailing twelve-month net loss of $117.8 million. The coming report will test whether the company can sustain its momentum while addressing fundamental challenges.

The Numbers Tell a Story of Ambition—and Risk

Remitly’s Q1 2025 EPS growth of 105% outpaces not only its own Q1 2024 results but also the broader market. The S&P 500 is projected to grow EPS by just 6.85% for the same quarter, underscoring Remitly’s position as a high-growth outlier. Analysts attribute this to the company’s strategic focus on underserved markets and its push into financial services beyond remittances. The full-year 2025 outlook—EPS of $0.86 and revenue of $1.58 billion—reflects confidence in its ability to capitalize on rising demand for digital payments in emerging economies.

However, the company’s financial health remains precarious. Despite Q4 2024’s strong revenue beat of $351.9 million, its net loss widened to $117.8 million over the trailing twelve months. This raises critical questions: Can Remitly convert its top-line growth into sustainable profitability? Will operational efficiencies materialize to offset high customer acquisition costs? The May earnings call will likely hinge on management’s answers to these questions.

Analyst Optimism, But Prudent Caution

Analyst sentiment is overwhelmingly bullish, with 12 out of 14 maintaining “Overweight” or “Buy” ratings. The average price target of $27.29—$7.66 above current levels—suggests investors believe Remitly can overcome its profitability struggles. JPMorgan’s recent note highlighted the company’s “strong unit economics” and “high retention rates,” while Barclays emphasized its “dominant position in key corridors.”

Yet risks linger. A slowdown in remittance flows due to global economic headwinds or regulatory hurdles in key markets could disrupt growth. Additionally, competitors like Wise and World Remit continue to innovate, intensifying price competition. Remitly’s valuation—particularly its price-to-sales ratio of 4.1x—assumes flawless execution.

The Road Ahead: Growth vs. Profitability

Remitly’s reaffirmed $1.6 billion revenue target for 2025 aligns with consensus estimates, but investors will scrutinize qualitative factors:
1. Margin Improvement: Can gross profit margins expand from 15% in 2024 to 18% in 2025, as guided?
2. Customer Retention: Sustaining its 85% repeat customer rate will be vital for recurring revenue.
3. Product Diversification: Progress in its banking and crypto offerings could unlock new revenue streams.

The Q1 results will also gauge the impact of its cost-cutting initiatives, including workforce reductions announced in late 2024. A narrowing net loss—or even a surprise profit—would be a major confidence booster.

Conclusion: A High-Wire Act, but the Odds Favor Growth

Remitly’s Q1 2025 results are likely to meet or exceed expectations, given its strong Q4 performance and the favorable tailwinds of digital adoption in remittances. With a projected 29% revenue growth and 105% EPS expansion, the company is on track to solidify its position as a leader in cross-border payments. However, its valuation hinges on proving it can monetize growth without sacrificing profitability.

The data is clear: Remitly’s revenue trajectory (+24.8% annual growth) outpaces the global remittance market’s expected 6% growth, and its $1.58 billion 2025 revenue target represents a meaningful scale-up. Yet until it turns a profit, investors must balance this optimism against the risk of persistent losses. The May 7 earnings call will provide critical clarity on whether Remitly’s ambitions are grounded in sustainable execution—or if they remain a high-risk bet on future scalability. For now, the company’s momentum appears intact, but the path to profitability remains its ultimate test.